02 October 2012

The Enduring Principle of Newfoundland Mining Development Policy #nlpoli

If you want to understand the provincial government’s mining policy, look no further than Joe Smallwood and a speech he gave to the local chapter of what was then the Canadian Institute of Mining and Metallurgy in 1979.

At the start of the speech, Smallwood quotes from his 1931 book, The New Newfoundland.  Newfoundland had to use foreign capital to develop resources.  These foreign capitalists did not regard Newfoundland as a good place to do business.  The reasons were obvious, Smallwood wrote.

Therefore, “[w]e are literally compelled, Smallwood wrote on page six, “to make them attractive offers by way of concessions and the certainty of a larger return on capital than can normally be obtained nearer the source.  It is, after all, a simple case of the working of our old friend, the law of supply and demand…”

Newfoundland got jobs.  The companies got concessions and better returns on investment than they could get anywhere else.  What Smallwood described in 1979 and 1931 was the same policy followed by Newfoundland governments from the 1880s onward

Fast forward to the second decade of the 21st century.

Some reporters asked Premier Kathy Dunderdale about the prospect that companies looking to build mines in Labrador would get a break on their electricity prices. As CBC reported:

Dunderdale said it's business as usual to offer electricity discounts in return for jobs and investment.

"We want companies to invest here, to create work for our people here in Newfoundland and Labrador," she told reporters last week. "But at the same time, you have to be sure that there's a return to the people of the province.

"Remember: this is a foundational principle of this government, that the people ... be the beneficiaries of the development of our natural resources."

The fundamental principle of Kathy Dunderdale’s administration is the same as that of every other government in Newfoundland and Labrador – with a few exceptions – dating back to the 19th century.

-srbp-

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